Monday, December 12, 2011

Global companies should adopt a greater Duty of Care approach as they move into new territories

Companies need to adopt an integrated risk management approach to provide Duty of Care to
IT, construction, and energy sectors identified key concerns
Many companies don’t realise they have a legal obligation to Duty of Care

DUBAI, UAE – A global benchmarking study commissioned by International SOS has revealed the
number of high-risk locations where global multinationals are increasingly doing business requires
greater Duty of Care by companies to protect their staff and manage their corporate risk.

The research, conducted by Dr Lisbeth Claus, professor of global human resources at the Atkinson
Graduate School of Management of Willamette University, showed that the key concerns of the
628 companies polled for the study included lawlessness, terrorism, political upheaval, civil unrest
and pandemics. The respondent companies, of which nearly all (95%) had sent employees abroad
for work in the past year, said health issues comprised four of the identified top ten risks, including
illness, lack of access to western standards of medical care, infectious diseases and travel-related

International SOS, the world’s leading international healthcare, medical assistance, and security
services company, said global multinationals should develop an integrated risk management
strategy to cover their Duty of Care obligations. Duty of Care is a company’s obligation to protect
its employees from risks. Among other things, these risks can be related to injury, sickness, safety,
security, health, finances and travel.

Duty of Care, as an aspect of a company’s total risk management strategy, has become increasingly
important as globalization gathers momentum. A recent International SOS analysis of travel data
collected from more than 300 global companies over the past year indicated that the companies’
travelers took more than 3.5 million international trips, and approximately a quarter (25%) of these
were to high or extreme risk destinations. Clearly, as employees cross more borders, they – and the
companies they represent – face more risk.

It is of particular relevance to companies that have set up in emerging markets to expand their
businesses. Three industries that were seen to have particular concerns were IT, construction, and
energy and natural resources, all of which are attracting significant investment by multinationals. IT
companies that participated in the survey said their main concerns were opportunistic crime, illness
while on assignment, road accidents and travel delays. The construction and real estate sector was
mainly concerned with lawlessness, violent crime and organized crime. The energy and natural
resource sector had elevated concerns about remoteness of work locations, language and cultural
estrangement, and road accidents.

Dr Claus’ report showed that a surprisingly high proportion of respondent companies – one third –
did not know whether they had legal requirements for a duty of care provision. This was a particular
concern, as a company can be held criminally responsible for harm to employees or their dependents
in high-risk locations abroad, should the risk result from a failure of duty of care in their operating

For internal use only

Despite the legal implications and medical costs involved in taking care of incidents, companies
still perceived duty of care as primarily an ethical concern. Caring about the health, safety, and
security of travelling employees and doing the right thing were both more popular considerations in
upholding a duty of care than avoiding outlay and legal repercussions.

“We are committed to helping companies, such as the Global 500, to implement effective duty of
care strategies. Our study has found that such approaches are clearly linked to commercial success,
and yet there are still varying levels of awareness among senior management and key stakeholders,”
explained Co-founder, Chairman and Chief Executive of International SOS, Arnaud VaissiƩ.

“The global benchmarking study highlights the need for companies to focus on the best ways to pre-
emptively protect their employees and their businesses.”

International SOS has already established a significant presence in the Middle East in recognition of
the growing presence of multinationals. It recently launched a new state-of-the-art air ambulance,
based in Abu Dhabi, to support growth of client activity in the Middle East.

The new air ambulance will further reduce the response times to reach patients in the event of a
medical emergency in locations within the Middle East, the Caspian and Central Asia.

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